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Citation: 64 Fed. Reg. 43255 1999

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Federal Register 

# Presidential Documents

Vol. 64, No. 153 Tuesday, August 10, 1999



### Title 3- Executive Order13132 ofAugust 4, 1999


## The President Federalism

By the authority vested in me as President by the Constitution and the laws ofthe United States ofAmerica, and in order to guarantee the division of governmental responsibilities between the national government and the States that was intended by the Framers of the Constitution, to ensure that theprinciples offederalism established by theFramers guide the executive departments and agencies in the formulation and implementation of policies, and to further the policies of the Unfunded Mandates Reform Act, itisherebyordered asfollows: Section 1.Definitions.Forpurposes ofthisorder: (a) "Policies thathave federalism implications" refers toregulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution ofpowerandresponsibilities amongthe variouslevels ofgovernment. (b) "State" or "States" refer to the States ofthe United States ofAmerica, individually or collectively, and, where relevant, to State governments, includingunits oflocal government and otherpolitical subdivisions established bythe States. (c) "Agency" means any authority ofthe United Statesthat isan "agency" under 44 U.S.C. 3502(1), other than those considered to be independent regulatory agencies, asdefined in44U.S.C. 3502(5). (d) "State and local officials" means elected officials of State and local governments ortheirrepresentativenational organizations. See. 2. FundamentalFederalismPrinciples.In formulating and implementing 

### policies that have federalism implications, agencies shall be guided by the followingfundamental federalism principles: (a) Federalism is rooted in the belief that issues that are not national in scope or significance are most appropriately addressed by the level of government closest tothepeople. (b)Thepeople ofthe Statescreated the national government and delegated to it enumerated governmental powers. All other sovereign powers, save those expressly prohibited the States by the Constitution, are reserved to the States ortothepeople. (c) The constitutional relationship among sovereign governments, State and national, is inherent in the very structure of the Constitution and is formalized in and protected by the Tenth Amendment to the Constitution. (d) The people ofthe States are free, subject only to restrictions in the Constitution itself or in constitutionally authorized Acts of Congress, to definethemoral,political,and legal character oftheirlives. (e) The Framers recognized that the States possess unique authorities, qualities, and abilities to meet the needs ofthe people and should function
as laboratories ofdemocracy.Federal Register/Vol. 64, No. 153/Tuesday, August 10, 1999/ Presidential Documents

(f)The nature ofour constitutional system encourages a healthy diversity in the public policies adopted by the people ofthe several States according to their own conditions, needs, and desires. In the search for enlightened public policy, individual States and communities are free to experiment with a variety of approaches to public issues. One-size-fits-all approaches to public policy problems can inhibit the creation of effective solutions to thoseproblems. (g) Acts of the national government-whether legislative, executive, or judicial in nature-that exceed the enumerated powers of that government under the Constitution violate the principle of federalism established by theFramers. (h) Policies ofthe national government should recognize the responsibility of-and should encourage opportunities for-individuals, families, neighborhoods, local governments, and private associations to achieve their personal, social, and economic objectives through cooperative effort.

(i) The national government should be deferential to the States when taking action that affects the policymaking discretion of the States and should act only with the greatest caution where State or local governments have identified uncertainties regarding the constitutional or statutory authorityofthenational government. Sec. 3. Federalism Policymaking Criteria.In addition to adhering to the fundamental federalism principles set forth in section 2, agencies shall adhere, to the extent permitted by law, to the following criteria when formulatingand implementing policies that havefederalism implications: (a) There shall be strict adherence to constitutional principles. Agencies shall closely examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and shall carefully assess the necessity for such action. Tothe extent practicable, State and local officials shall be consulted before any such action is implemented. Executive Order 12372 ofJuly 14, 1982 ("Intergovernmental Review of Federal Programs") remains in effect for the programs and activities to which itis applicable. (b)National action limiting the policymaking discretion ofthe States shall be taken only where there is constitutional and statutory authority for the action and the national activity is appropriate in light of the presence ofaproblem ofnational significance. Where there are significant uncertainties

as to whether national action is authorized or appropriate, agencies shall consult with appropriate State and local officials to determine whether Federal objectives canbe attained byothermeans. (c) With respect to Federal statutes and regulations administered by the States, the national government shall grant the States the maximum administrative discretion possible. Intrusive Federal oversight ofState administration is neithernecessary nordesirable. (d) When undertaking to formulate and implement policies that have federalism implications, agencies shall: (1) encourage States to develop their own policies to achieve program objectives and towork with appropriate officials in other States; (2)where possible, defertothe States toestablish standards; (3) in determining whether to establish uniform national standards, consult with appropriate State and local officials as to the need for national standards and any alternatives that would limit the scope of national standards orotherwisepreserve Stateprerogatives and authority;and

(4) where national standards are required by Federal statutes, consult with appropriate State and local officials in developing those standards. 

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Sec. 4. Special Requirementsfor Preemption. Agencies, in taking action that preempts State law, shall act in strict accordance with governing law. (a) Agencies shall construe, in regulations and otherwise, aFederal statute to preempt State law only where the statute contains an express preemption provision or there is some other clear evidence that the Congress intended preemption of State law, or where the exercise of State authority conflicts with theexercise ofFederal authority undertheFederal statute. (b) Where a Federal statute does not preempt State law (as addressed in subsection (a) of this section), agencies shall construe any authorization in the statute for the issuance of regulations as authorizing preemption ofState law byrulemaking only when the exercise ofState authority directly conflicts with the exercise of Federal authority under the Federal statute

or there is clear evidence to conclude that the Congress intended the agency to havethe authority topreempt Statelaw. (c) Any regulatory preemption of State law shall be restricted to the minimum level necessary to achieve the objectives of the statute pursuant to which theregulations arepromulgated. (d) When an agency foresees the possibility of a conflict between State law and Federally protected interests within its area ofregulatory responsibility, the agency shall consult, to the extent practicable, with appropriate Stateand local officials in aneffort toavoid such aconflict.

(e) When an agency proposes to act through adjudication or rulemaking to preempt State law, the agency shall provide all affected State and local officials notice and an opportunity for appropriate participation in the proceedings. Sec. 5. SpecialRequirementsforLegislative Proposals.Agencies shall not submittothe Congress legislation that would:

(a) directly regulate the States in ways that would either interfere with functions essential to the States' separate and independent existence or be inconsistent with the fundamental federalism principles in section 2; (b) attach to Federal grants conditions that are not reasonably related to thepurposeofthegrant; or (c) preempt State law, unless preemption is consistent with the fundamental federalism principles set forth in section 2, and unless a clearly legitimate national purpose, consistent with the federalism policymaking criteria setforth in section 3, cannot otherwise bemet. Sec. 6. Consultation. (a) Each agency shall have an accountable process to ensure meaningful and timely inputby State and local officials in thedevelopment ofregulatory policies that have federalism implications. Within 90 days after the effective date of this order, the head of each agency shall designate an official with principal responsibility for the agency's implementation of this order and that designated official shall submit to the Office ofManagement and Budget

adescription oftheagency's consultation process. (b)To theextent practicable and permitted bylaw, noagency shall promulgate any regulation that has federalism implications, that imposes substantial direct compliance costs on State and local governments, and that is not required by statute, unless: (1) funds necessary to pay the direct costs incurred by the State and local governments in complying with the regulation are provided by the Federal Government; or (2)the agency, priorto theformal promulgation oftheregulation, (A) consulted with State and local officials early in the process of developing theproposed regulation; 

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(B) in a separately identified portion ofthe preamble to the regulation as it is to be issued in the Federal Register, provides to the Director ofthe Office ofManagement and Budget afederalism summary impact statement, which consists of a description of the extent of the agency's prior consultation with State and local officials, a summary of the nature of their concerns and the agency's position supporting the need to issue the regulation, and a statement of the extent to which theconcerns ofState and local officials have been met; and (C) makes available to the Director ofthe Office ofManagement and Budget any written communications submitted to the agency by State and local officials. (c) Tothe extentpracticable and permitted by law, noagency shall promulgate any regulation that has federalism implications and that preempts State law, unless the agency, prior to the formal promulgation ofthe regulation, (1) consulted with State and local officials early in the process ofdevelopingtheproposed regulation; (2) in a separately identified portion ofthe preamble to the regulation

as it is to be issued in the Federal Register, provides to the Director of the Office of Management and Budget a federalism summary impact statement, which consists of a description of the extent of the agency's prior consultation with State and local officials, a summary ofthe nature of their concerns and the agency's position supporting the need to issue the regulation, and a statement of the extent to which the concerns of Stateand local officials have been met; and

(3) makes available to the Director of the Office of Management and Budget any written communications submitted to the agency by State and local officials. Sec. 7. Increasing Flexibility forStateandLocalWaivers. (a)Agencies shallreview theprocesses under which State and local governments apply for waivers of statutory and regulatory requirements and take appropriate steps tostreamline thoseprocesses. (b) Each agency shall, to the extent practicable and permitted by law, consider any application by a State for a waiver of statutory or regulatory requirements in connection with any program administered by that agency with a general view toward increasing opportunities for utilizing flexible policy approaches at the State or local level in cases in which the proposed waiver is consistent with applicable Federal policy objectives and is otherwise appropriate. (c) Each agency shall, to the extent practicable and permitted by law, render a decision upon a complete application for a waiver within 120 days of receipt of such application by the agency. If the application for

a waiver is not granted, the agency shall provide the applicant with timely written notice ofthedecision and thereasons therefor. (d) This section applies only to statutory or regulatory requirements that

are discretionary and subjectto waiver bytheagency. Sec. 8.Accountability. (a) In transmitting any draft final regulation that has federalism implications to the Office ofManagement and Budget pursuant to Executive Order 12866 of September 30, 1993, each agency shall include a certification from the official designated to ensure compliance with this order stating that the requirements of this order have been met in a meaningful and timely manner. (b) In transmitting proposed legislation that has federalism implications to the Office ofManagement and Budget, each agency shall include a certification from the official designated to ensure compliance with this order that allrelevant requirements ofthis orderhave been met. 

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(c) Within 180 days after the effective date of this order, the Director ofthe Office ofManagement and Budget and the Assistant to the President for Intergovernmental Affairs shall confer with State and local officials to ensure thatthisorderisbeingproperlyand effectivelyimplemented. Sec. 9. IndependentAgencies. Independent regulatory agencies are encouraged tocomplywith theprovisionsofthisorder. See. 10. GeneralProvisions. (a) This order shall supplement but not supersede the requirements contained in Executive Order 12372 ("Intergovernmental Review of Federal Programs"), Executive Order 12866 ("Regulatory Planning and Review"), Executive Order 12988 ("Civil Justice Reform"), and OMB Circular A-19. (b) Executive Order 12612 ("Federalism"), Executive Order 12875 ("Enhancing the Intergovernmental Partnership"), Executive Order 13083 ("Federalism"), and Executive Order 13095 ("Suspension of Executive Order 13083")arerevoked.

(c) This order shall be effective 90 days after the date of this order. Sec. 11. JudicialReview. This order is intended only toimprove the internal management of the executive branch, and is not intended to create any right or benefit, substantive or procedural, enforceable at law by a party againstthe United States, itsagencies,itsofficers,orany person.

THE WHITE HOUSE, August 4, 1999. [FR Doc. 99 20729 Filed 8 9 99; 8:45 am] Billing code 3195 01 P 

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